Latin American Network Information Center - LANIC

-DATE-
19861227
-YEAR-
1986
-DOCUMENT_TYPE-
SPEECH
-AUTHOR-
F. CASTRO
-HEADLINE-
11TH ANPP ASSEMBLY
-PLACE-
CUBA
-SOURCE-
HAVANA TV SERVICE
-REPORT_NBR-
FBIS
-REPORT_DATE-
19861231
-TEXT-
CASTRO ADDRESSES 11TH ANPP ASSEMBLY 26 DEC

F1271400 Havana Television Service in Spanish 0132 GMT 27 Dec 86

[Remarks by Commander in Chief Fidel Castro Ruz, first secretary of the
Communist Party of Cuba Central Committee and president of the Councils of
State and Ministers, "during the discussion and approval of the single
socioeconomic development plan and state budget for 1987" at the 11th
regular period of sessions of the National Assembly of the People-s
Government, ANPP, on 26 December -- recorded]

[Text] Comrades, I would first like to clear up a point about the deficit.
Our deficit is bigger. It is not 115 million. What happened was that one
adds the credits to the income that we received from socialist countries,
basically the Soviet Union. These are annual credits for investments and
various other needs. These credits are added to the income and that is why
they reduce the deficit. But the real deficit, the difference between the
country's income and expenditures, is bigger. So although the deficit is
relatively small, that does not make less important the effort to augment
revenues and reduce the deficit and obtain a surplus. Its magnitude without
those revenues would be much greater.

Now, although the things that our fellow deputies are discussing are
important, without a doubt, I feel that we should not allow the debate to
continue in this direction, because we could get the impression even if
only for a few minutes that the problems are much simpler than they really
are, and much easier to solve than they really are. Would that our problems
were that simple!

If they depended, if they consisted of the points that the fellow deputies
have brought up -- expenses here, underutilization or waste there. All
these things are important. But they are not broaching -- and I cannot
blame them -- the fundamental problem. We cannot deduce from Comrade
(Lupito)'s words what the fundamental problems are, although he did hint at
them, he referred to the difficulties the economy faces. I believe that the
most important thing for the country in 1987, and possibly in a more
extended period of time, is basically this economic problem, the vital,
fundamental issue. The difficulties we have to face derive from
circumstances and factors, not only subjective ones, but in this case
fundamentally objective ones that have cropped up, complicating the
country's economic development.

In 1986, when the congress took place, our country drafted a plan that was
rational enough. In 1984, early 1985, the central group had been organized,
radical changes had occurred in methodology -- to use an oft-used work --
in drafting the plan. All the ministries had broad participation in the
preparation of the plan, as did the people's governments. Before, the plan
had been drafted by the board, it came down, it was discussed group by
group in terms of the resources they were requesting, the plans that they
wanted to carry out, and the resources assigned to them. With the new
method, all the organs and factors were given the opportunity to
participate in the drafting of the plans through the year. This way much
greater cooperation and participation were elicited and a more rational
plan was achieved. Therefore, the 1986 plan was drafted in these
circumstances. In 1985, the plan worked on in 1984 had to be redrafted. A
new plan had to be made adapting it to the realities in terms of external
finances, especially the realities in terms of convertible foreign
exchange, since imports were around $1.5 billion in 1984. Goods from the
West.

In truth, we spent more that year than we could afford to, and we found at
the end of 1984 that we had to have a more reduced plan, and not only a
more reduced plan but a plan that would help to increase exports in
convertible foreign exchange. We concluded at that time that we had to
increase exports within the next 4 or 5 years by no less than $500 million
to convertible areas, since it was felt that even $1.2 billion in imports
strongly limited the development of certain products and the meeting of
certain needs in our country.

Even so, when the plan was drafted, oil cost around $29 the barrel. The
devaluation of the dollar had still not come about. It affected us
indirectly in the form we have explained. The hurricane had not occurred
when that plan was drafted. The drought we had. The hurricane came on top
of the drought. The facts were that when the plan was drafted, based on
imports from the convertible area amounting to $1.2 billion, some of these
factors, which turned out to be decisive, were not part of the picture.

Around the time of the congress, after the congress, there was an abrupt
drop in the price of oil, practically by half. This affected us
considerably because the exports, or reexports of fuel -- basically
reexports and some exports -- of our production had become one of the most
important sources of foreign exchange for our country. So, that abrupt fall
in imports [as heard] deprived us of an income of around $300 million out
of the $1.2 billion that we had counted on. We were counting on an income,
imports of $1.2 billion. Around that same time, there was a sudden
devaluation of the dollar. These are mechanisms used by the capitalist
countries, imperialism, precisely to finance their rearmament. The dollar
was overvalued. It paid very high interests. It was a mechanism that
brought interests up, that considerably affected Third World countries,
Latin American countries to a very large degree. They had to pay very high
interests on their foreign debt.

Through this mechanism, imperialism obtained very large quantities of
money. Many countries affected by the devaluation, or rather affected by
inflation, deposited their money in American banks to earn high interests.
This caused many complaints among the debtors and caused complaints even
from the capitalist allies of imperialism. In the end, and this is
something that we had talked about, the United States had received large
loans, or large transfers of money, expensive money. In the end they were
going to pay with cheap money. In fact, in many aspects, the devaluation of
the dollar was benefitting a number of countries, because what they bought
in the United States they could buy at a reduced price. They could acquire
dollars, that is, if they exported to certain countries -- Japan, Europe --
they could later acquire the dollar more cheaply and they benefitted when
they got their imports which came from the United States.

In Cuba's case, as a consequence of the blockade that prevents trade with
the United States and forces trade in the West with a small number of
countries, the devaluation of the dollar paradoxically had a considerable
economic effect on us. Instead of buying products more cheaply had we been
able to trade with the United States, we had to pay more dearly that which
we imported from the capitalist countries: Japan, the FRG, Switzerland, any
of those countries. Let us remember that when the dollar was devalued, the
cost or price of the yen rose. If sugar was at 6 cents, for example, we had
an amount of money -- because it's 6 dollar cents -- we found when bought
in Japan that the yen had risen 30 or 40 percent. Therefore, what cost us
$100 before the devaluation now cost $130 or $140 -- any of the imports
from that area.

Well, according to our estimates, our expenditures went up $150 million
because of the devaluation of the dollar. We are using the dollar as the
measure because we cannot really use the peso; we can't make a cocktail of
currencies here. If the country had $100 to spend, $100 that came in from
its imports, now the country needed $130, $140 to buy the same thing. That
was another problem, in addition to the unequal exchange. Unequal exchange
consists, as I was saying yesterday, in the fact that sugar costs 6 cents;
it costs the same as 30 years ago. And I am using sugar as an example, but
the same goes for other exports from Third World countries, and what is
purchased cost five or six times more, or at least four times more. So,
between the effects of the oil price drop and the increase of the cost of
the currency we have to use to pay other Western countries, we were already
being affected to the tune of $450 million. Add to this the effects of the
drought, which had already factored in. But then the hurricane came.
Fortunately, we were able to keep the consequences of the hurricane to a
minimum because of the excellent job done by our sugarcane workers, when
they tried to cut cane that was bent, broken, and even twisted by the
hurricane in many provinces that were of great importance to the country's
sugar industry. Damage was kept at some 250,000. In practice it could have
been more, because the end-of-year rains could have increased, and were
already increasing, the supply of sugarcane or the estimates of sugarcane.
It could be that the hurricane might have finally affected us to the tune
of some 400,000 to 500,000 tons. After all, in 1985, which was a dry year,
some rain fell in the last quarter on important areas.

In short, we found that our income plan was reduced by around $500 million.
When the income from convertible foreign exchange dropped in such a large
amount, for the first time in 27 years our country could not meet its
international commitments. The debt had already been renegotiated. We were
not paying capital but interests. As a consequence of this abrupt fall in
our income we saw ourselves for the first time in 27 years suspending
international financial obligations. That, of course, was a complicated,
difficult situation. It caused a new renegotiation of the debt in difficult
conditions. Above all it caused complications in regard to the credits that
the country normally obtained when it was short of covertible currency to
meet some essential economic needs.

That reduction of income in convertible foreign exchange looked worse in
1987 [as heard]. Despite this difficulty, 1986 passed rather normally. But
the time had come to prepare the 1987 plan. Contrary to 1986, we could not
draft a plan based on imports from covertible areas of $1.2 billion. If at
the end of 1984, we considered it imperative to increase our exports by
$500 million within a period no greater than 5 years, the reality we were
facing in 1986 and 1987 was that income in covertible currency would be
reduced in around $500 million each one of those years. And if $1.2 billion
had been considered the absolute minimum for the economy earlier, we now
saw ourselves forced to think very realistically and to perform what could
be called almost a miracle.

What was that? A plan with only $600 or $650 million in imports from the
convertible area. Therefore, the central group, the planning board, the
party and state leaders saw ourselves in the situation of having to find a
solution to this problem. And the solution could not come from outside.
Some of the factors that affected us also considerably affected the foreign
exchange income of the Soviet Union -- to a considerable degree, because
they export large amounts of oil and gas. We do not belong to the
International Monetary Fund, the World Bank, or any one of those
international credit organizations controlled by imperialism.

Could we ask them for loans in convertible foreign exchange to face this
situation? And our closest friends at the same time were considerably
affected, as for instance, the Soviet Union, because of the same problem.
We could not think of finding solutions abroad. For many years, when the
price of sugar plummeted to 3.5 or 4 cents, we had credits. That is
precisely the source of the foreign debt in convertible currency.
Apparently nothing had happened. Sugar was at 4 cents. Convertible income
was very much affected. But everything remained the same in our country.
Our income, our consumption was not affected. On the contrary, income and
consumption increased.

The same thing happened to a large number' of Latin American countries,
even countries that had enormous income from oil exports, for instance.
Even though they had enormous incomes they were affected by the debt, since
everything they imported increased in price, and the other products that
the majority of the non-oil exporting countries sold were affected by
international prices as well. The social and economic situation in those
countries was truly terrible. Our country had to solve this problem with
its own efforts, its own resources, and especially with its own sacrifices.

Some people were discouraged with these difficulties. Discouragement and
defeatism are the only thing that has no room in the minds and hearts of
revolutionaries. [applause] Not even in the most difficult of times did
revolutionaries admit to discouragement. Revolutionaries must adopt
suitable measures when faced with each situation. Therefore, we had to make
do with our plan to import from convertible areas reduced to half the
minimum that we had previously considered indispensable.

There were periods, even with lower prices, when those imports rose to $1.5
or $1.6 billion. And we undertook that task, the drafting of the plan, to
know specifically what the effects would be. We were determined to deal
with the necessary effects but we wanted to know them with plenty of time,
so that this kind of problem would not catch us by surprise. Those were the
circumstances in which the plan was drafted, the economic plan that was
read in a few minutes.

We tried to have a plan that would not first of all sacrifice the country's
development. How to face this situation without affecting the country's
development? How at the same time to affect public consumption as little as
possible? We were basing ourselves on certain premises.

The plan was drafted this way, but not without effects. There are effects.
Again in 1987 we have the same circumstances of 1986. We will have some
$300 million less from reexport and export of fuel. Of course, the
possibilities of exporting fuel stemmed from a considerable effort made to
save fuel. Without that effort, the fuel would have been spent as it had
been in the past. Take the sugar industry. Each year it spent half a
million tons of fuel to produce 5 or 6 million tons of sugar. Our sugar
production was exceeding 7 million -- that is, 50 percent more. And yet, we
had been able to reduce to zero the amount of fuel used to produce raw
sugar in our mills. Our administrators in the past had not worried about
the optimal use of bagasse, which was the traditional fuel of the sugar
mills, and when there was any difficulty or the boiler pressure went down,
they opened the oil valve. Perhaps it would have been fair when speaking
about Cienfuegos to recall that it was precisely that province that set the
example to follow by reducing to zero the use of oil in the province's
sugar mills.

It was in the wake of the Cienfuegos experiment that the method, the policy
to reduce or produce fuel extended to the whole country. In fact, the fuel
valves were removed in many of the sugar mills and the use of fuel was
reduced to zero, except in those sugar mills that have no bagasse because
they have to use it for wood or paper and therefore they need some energy.
But, consumption was reduced to zero by replacing it with wood, saving the
bagasse, creating reserves, and sometimes transferring it from one mill
that had more than it needed to others. But these savings of 500,000 tons
gives you an idea of how fuel was wasted in our country. We were able to
export precisely as a consequence, fundamentally, of that effort, aside
from domestic production which has speeded up in recent years and now
reaches around 1 million tons.

But those exports were based on a determined income. Now the corresponding
incomes had been reduced to half. And no one knows for how long. Maybe when
they raise the price again we will no longer have any surplus except what
we get from increased local oil production.

Logically, no matter how much we save, development requires the use of
fuel. When the Moa enterprise is in full operation, it will use up hundreds
of thousands of tons, and so will other industries. Nevertheless, we
believe that it is still possible to save more in our use of fuel. Each ton
that we save will either help us to obtain additional income in convertible
foreign exchange or will allow us to develop plans or make bigger
investments there where the limitations of fuel turn into an obstacle for
the full development of those plans.

This situation will be repeated in 1987. It might repeat itself in 1988. It
cannot be predicted how long these low prices will last in an area that had
provisionally become an important source of income for the country. There
are still problems in relation to the devaluation of the dollar and an even
bigger devaluation could take place to add to the cost of the currency of
those countries from which we export capitalist goods.

On top of this, the drought of this year is much worse than the droughts of
years past, and much worse than the one of 1985. I asked the Academy of
Sciences several weeks ago to keep me informed about the rains. I asked
them to collect historic data on the average of rains, and how much it had
rained in the past few years, in 1985 and 1986. We were able to find out
with some precision how abnormal the rain has been, not only in 1985 and
1986, but since 1981. For 6 years. A rigorous study was carried out by the
Academy of Sciences. Data for the last 40 years show interesting
comparative figures that our cadres and all people should learn about.

Because in a way we have become used to looking at problems as if they did
not exist, to acting as if there were no calamity or problem. This
situation has been occurring for 6 years. The Academy of Sciences report
says: Analyzing the pattern of accumulated rain nationwide during
1981-1986, rainfall in these years has been below the historic mean. The
most critical provinces: Guantanamo, with 57 percent; Santiago de Cuba,
with 62 percent; Holguin, with 71 percent; and Matanzas, with 72 percent. I
remember in the first years of the revolution, the decade of the sixties,
and other periods, that we looked at the rain figures every day. Generally,
rain was above the historic mean one year, below the next.

Rainy years alternated with dry years, except in some occasions when we had
two consecutive years -- and this happened once or twice in the past --
that were below the historic average. If we use the terms employed in the
international bibliography [as heard] to determine the qualitative pattern
of a single year or period, in consideration of the percentage of total
precipitation in respect to the historic average, the following criteria
must be used:

A drought is when the total annual rainfall is equal or less than 85
percent of the mean. In terms of intensity, droughts are classified as:
moderate drought, more or less 85 percent; intense drought, less than 75
percent; very intense drought, less than 70 Percent of the annual mean.
Accordingly, in 1986 our country is experiencing a very intense drought. Of
course, these data about the average yearly rainfall do not exactly
describe the specific situation, because sometimes it rains in the
mountains, and in certain provinces with not too much sugarcane. These
could influence the average, and yet the situation in the most important
sugarcane areas may be well below the yearly average, the historic average.

So we have that in 1985 the drought was intense, but yearly rainfall was 80
percent of the historic average, with some provinces below that 80 percent,
such as Pinar del Rio, Havana, Havana City -- rain doesn't matter so much
in Havana City -- Matanzas, 68 percent; Holguin, 73 percent; Santiago de
Cuba, 60 percent; Guantanamo, 47 percent; Isle of Youth, 76 percent. Now
what has been the rain pattern this year? For the second consecutive year
with accumulating effects? They gave rise to spring planting in 30,000
caballerias to try to reestablish the fields that were very affected first
by the hurricane and then by the drought.

Nationally, up to 21 December, rainfall was 65 percent of the historic
average. That is how much rain has fallen nationwide. And we had said that
below 70 is classifield worldwide as a very intense drought. In Pinar del
Rio, rainfall was 73 percent; in Havana Province, 68 percent; in Havana
City, 70; in Matanzas, where it was 68 percent last year, it was 62 percent
of the historic average. In Cienfuegos it was 83; it was the only province
with a moderate drought. In Villa Clara, 63 percent; in Sancti Spiritus, 74
percent; In Ciego de Avila, 71 percent; in Camaguey, 65 percent. Yes
[rustling of papers] In Las Tunas, 58 percent. It rained 658 millimeters as
compared with an average... [rustling of papers] I am looking for a figure
that I had to fix because where it said 48 it should have been 58. Right!
In Las Tunas, 658 millimeters -- 58 percent. In Holguin, 45 percent; in
Granma, 65 percent; in Santiago de Cuba -- and remember they had heavy
rains in June -- 68 percent; in Guantanamo, 49 percent; in Isle of Youth,
67 percent. That is the level of drought after a year of drought. And this
shows in the reservoirs. If we exclude Carlos Manuel de Cespedes and
Protesta de Baragua -- it used to be called Canasta when it was being built
-- other reservoirs throughout the country are practically empty. Well, we
don't know what would have happened without those reservoirs, which at
least allowed the cultivation of rice, for example, even with some
difficulty. Now, rice harvests in cold areas, where the yield is the
highest, have been reduced to a minimum. A cooperative of the prestige of
the Aniceto Perez cooperative here in Havana, which is not a rice
cooperative -- it plants potatoes, vegetables, and other crops -- has
reduced its area of cultivation to a third. So, this has to affect our
production, not only of sugarcane, but also the production of dairy goods,
tubers, vegetables, and other foodstuffs.

I believe that this should make us stop and think. At a certain point there
was a great hydraulic boom [voluntad] in the country. It started to develop
with Hurricane Flora and the devastating floods it brought with it. We lost
more than 1,000 lives and there was great economic damage. I don't remember
exactly, but we lost a bit over 150,000 heads of cattle. A program was
undertaken to build dams to control floods and at the same time use them to
develop rice paddies and other crops.

This hydraulic boom acquired great force in the decade from 1965 to 1975.
This hydraulic boom later little by little collapsed. Allotments, resources
were missing from the plans. The building of dams and irrigation systems
faltered. This affected the production of citrus fruit, among other things.
In the last 5-year period, the plan for hydraulic works, which was already
quite modest, was fulfilled only 70 percent. What was left undone in the
building of dams was the equivalent of a full year of work. In some
provinces, the engineering works enterprises brought together the
construction of roads and dams. This, along with negative trends that
developed, such as the allocation of few resources to many projects, which
led to the perpetuation of the projects, resulted in 1980-85 becoming the
5-year period when the growth of capabilities in millions of cubic meters
was reduced to a minimum.

It is true that many of the most productive reservoirs -- in the sense that
they had the easiest to close dams, the biggest rivers -- have been built,
but there remains a large potential in the utilization of our hydraulic
resources. I was telling our comrades at the Central Committee meeting
about Vinales, a municipality we visited during "Bastion 86." We saw the
situation there. There was a big drought. Nevertheless, a cooperative there
had completed its tobacco planting and all other planting although it had
not rained. There was a microdam of 600,000 cubic meters which in
mid-January has no water, not because it is consumed but because it filters
away. Maybe because the groundwater table level drops and the ground is
calcareous, the water runs out. However, they had water those 2 and 1/2
months; they were practically ready to begin the tobacco harvest, and,
waiting for the rains, had done the planting. I asked Comrade Lugo of Pinar
del Rio Province and the comrades at the municipality to make a study on
how many microdams could be built there to run Vinales into a model of
utilization of all water sources. They brought out a map showing all that
can be done there. There is still a lot to be done. A similar situation is
probably facing municipalities in uneven terrain because it is more
difficult to build this kind of dam in the plains to guarantee water in
critical periods and to carry out agricultural production.

At this meeting I told the comrades of the central group and the planning
board about the need to recover dam construction capabilities, to study
well how to redistribute resources to go back again to build up the tempo
of dam construction -- big, medium-sized, small. It is in these
circumstances that one can appreciate how valuable these investments are in
guaranteeing the water supply.

Of course, the 1986 drought is more serious than any of the others of the
past 40 years. And we say 40 years because those were the figures recorded
by the Academy of Sciences. If the research had been extended, it is
possible that it could be the worst in the past 50 or 60 years. But nothing
can be said for sure. Only that we have had a period of little rain.
Logically, it has been affecting agricultural production and has affected
it basically in the last 2 years.

One of the first conclusions that we must draw is that we must recover the
hydraulic boom and our tempo in creating sources of water supply. This is
very important, and an example is that if this year in Havana Province we
can plant the same amount of potatoes that we have been able to do in the
past, despite a low groundwater table, it is because we finally finished
the Pedroso Masposton canal, which allows us to utilize some 80 million
cubic meters at present stored in the Masposton reservoir, a work that was
begun many years ago. It was a project that already had many of the induced
[inducidas] works, such as a smaller dam to pump the water that flows from
the Aguacate valley. It was slowly and finally finished in 1986. It will
allow us to extend the cultivation because not all the water available will
be able to be used, as irrigation systems are yet to be built. One of the
things that we have proposed ourselves is to have the steelworking industry
build 50 of those systems this very year, 1987.

This is a very important kind of irrigation system which we are receiving
in limited quantities from the USSR because it does not have bigger
supplies, only 25 each year. It is a very efficient, economical system that
saves water. They are not too complex to build. We hope that at the end of
the 5-year period the steelworking industry will be producing around 150 of
these each year.

With all the factors involved, we could delude ourselves into believing we
could go on as if none of these factors were present, affecting our
economy. Of course, our economy has the enormous advantage of finding
support in the economic and commercial relations with the socialist
community, especially with the Soviet Union. That is, a large part, a
fundamental part of our economy finds support in that. If this were not so,
I would hate to imagine how we would manage to consume more than 10 million
tons of oil and export the excess, which has been the result of
economizing. How could we guarantee our levels of energy consumption,
general economic activity, and production in general?

Why are these components from the capitalist area so important? Because
they are goods that we cannot obtain in the socialist area. Certain amounts
of grain for the production of fodder, for instance, to keep up the
production of milk, eggs, and meat. We cannot obtain these things in the
socialist area. For instance, certain medicines, certain raw materials. If
a production requires 40 raw materials and 35 come from the socialist area,
if we are short 5 from the capitalist area, then we cannot make the
product. This includes foodstuffs, raw materials for medicine, medicines,
spare parts, raw material. It could be an important herbicide for the
sugarcane, or a pesticide, or certain seeds, etc.

What forces us... [changes thought] what turns these imports into very
necessary imports?

Well, the plan has been drafted on the basis of these realities. But before
going on, before finishing with this factor we were examining, it would do
well to point out that to deal with the drought we should not only find
support in the continuation of our hydraulic works program; there is a very
important second factor which for a time had been relatively neglected, and
which has received greater attention in recent years. That is the potential
of making rain. This is the second element we should use to fight as much
as possible this kind of natural disaster. Since 1982, the Academy of
Sciences has been carrying out a rigorous, methodic research program on the
possibility of making rain by seeding the clouds with certain products.

I believe that in this case it is silver iodide. [rustling of papers] Is it
silver iodide that they are using in Camaguey, Lazaro? [rustling of papers]
So they already have some results of this seeding of clouds, this making it
rain. Summary of the campaign to produce rain for the period 1982-86. The
following results were confirmed through various evaluation methods: In
1982, April-June, Holguin, Pinar del Rio, and Camaguey. Dependence exists
between operations and precipitation. In 1982, September, October, Santiago
de Cuba. Increased precipitation. In 1983, May-October, Guantanamo,
Santiago, Granma, and Holguin. Increase in Guantanamo; August estimate: 36
million cubic meters; September estimate: 10 million cubic meters. In 1984,
April-October, Guantanamo, Santiago, Granma. Estimated increase in
Guantanamo, 300 million cubic meters. Dependence between operations and
rain. In 1985, April-October, Guantanamo, Santiago, and Granma. Dependence
was determined between operations and rain. Estimated increase in the three
provinces in the whole period, 800 million cubic meters. In 1986,
April-November, Guantanamo, Santiago, Holguin, Pinar del Rio, Havana, and
Matanzas. Evaluation not concluded.

The research shows that in all years, all provinces, there is a relatively
important increase in precipitation using these methods. I feel we must
intensify this research and apply its results as soon as possible. It is
showing us a second very important point of support for us to fight this
problem. Clouds with sufficient moisture but not enough for precipitation
often pass over the country, and with this technology we could make a lot
of those clouds precipitate, especially over the areas where we have the
reservoirs.

As I was telling you, these circumstances determined the drafting of the
plan. We were trying to find an optimal plan with the two objectives I
mentioned earlier: to not sacrifice development and to affect public
consumption as little as possible. It is not going to affect either
economic or social development.

Before making this study, this analysis, this variant of a plan of around
$600 or $650 millions of imports in convertible currencies, we did not have
a very clear idea of what the inevitable effects would be, measures that we
would inevitably have to apply in 1987. That is why I want to bring them up
for you and for the rest of the population.

Why were the measures agreed on? Partly to save convertible foreign
exchange and partly to seek internal financial balance between our income
and the resources available to produce that income. The deficit, too. I
want to show you here what these measures consist of. They are the minimum,
but that doesn't mean they are the only ones. No one can be sure whether in
the course of the year it will be necessary to adopt other measures. Since
this situation will not be resolved in 1988 and because development and
investments have to go on, it is likely that additional measures will be
necessary in the 1987-88 plan. And if we are wise, we really should extend
this radical policy designed to save convertible foreign exchange and to
depend less on this foreign exchange through the rapid completion of those
investment objectives that can replace imports in convertible currencies,
or those investment objectives that will augment exports in convertible
currency. This, through greater efforts to the extent possible to obtain in
the socialist countries part of what we are forced to acquire at present
from the capitalist camp.

I believe, I am convinced, that the measures that we take now will be
realistic ever -- that is, they will address the reality of a blockaded
country, a country that has difficulties in increasing its exports in
convertible currency areas. Because we export nickel and the Yankees chase
our nickel all over the world, they do not feel it is enough to deprive us
of the American market, one of the biggest markets in the Western world.
Many countries all over, when they make up their programs to increase
exports, estimate a large part of this increase will come from the American
market. They are not happy with just depriving us of that market. They do
other things. They chase our exports all over the world. They take
measures, you could say repressive measures, against companies that buy
nickel or buy other Cuban products, forbidding them to transport cargos
that include nickel or other Cuban material to the United States. They are
not happy with just doing that. Look at their sugar policy. Of 5 million
tons they imported some years ago, they are now importing 1 million -- 20
percent. And they are doing away with those imports. When we discussed the
foreign debt, we had mentioned this. They had reduced the sugar quota to
less than 2 million, and now they have brought it down to 1 million. A hue
and a cry has been raised by scores of countries that exported sugar to the
American market. With that merciless, implacable selfishness, they reduced
by half the quota for countries such as the Dominican Republic; scores of
other countries have been affected by that implacable measure taken by
imperialism, cutting down to a million. They are also affecting those
countries that did not have a U.S. quota, because in these past years they
have dumped on the market the 4 million that they had stopped importing.
This 4 million have ended up in the international market.

And if you take the 5 million tons the EEC dumped on the international
market, a region that used to import sugar and now exports 5 million tons
of subsidized sugar, and add the 4 million that the United States has
stopped importing by replacing it with subsidized sugar, this would explain
the drawn-out period of depressed prices that the so-called international
sugar market has been experiencing.

In the drafting of the plan, seeking the objectives that we mentioned,
seeking to save convertible currency, and seeking an adequate internal
financial balance, we agreed on some 30 measures, from 35 [as heard] to 30
measures for application in 1987. I am going to list them:

We will eliminate the quota of electrical domestic appliances and spring
mattresses for social programs, except in organizations such as tourism.
This is to make more of those articles available for sale to the public.
The objective is to earn income, to help the balance of domestic finances.

We will adjust the distribution system of liquid milk. Everything possible
was done. We cannot import more powdered milk above what we are receiving
now. We are receiving around 20,000 tons from the GDR, around 9,000 from
the Soviet Union, some amounts from the world food program. We cannot think
of importing powdered milk in convertible currencies. With certain
adjustments we can meet the needs. We can make a big effort in our own
external [corrects himself] internal production despite the rain [as
heard], despite the drought, without affecting, for instance, the
distribution of milk among children. We will keep their quota of a liter of
milk. We will have to make some adjustments, whether with the intermediate
level student or the secondary rural schools. They receive half a liter.

We, will adjust it to one third. In those workers' lunchrooms where they
received a third, we will adjust it to a fourth. In certain diets, we will
adjust to a fourth of a liter. So, these are a whole series of measures
that will not affect the children but will still meet needs without
spending convertible foreign exchange in imports of powdered milk.

Adjustments will be made in a small degree to the diets of boned beef. It
will be adjusted to about 1/4 pound. You see, we have to go down to the
nitty-gritty, with plenty of precision, with the intention of affecting the
least number.

We will eliminate the afternoon snack service in the administrative spheres
of the central organs of the state and of the local organs of the people's
government. That is, the afternoon snack is done away with. I sincerely
tell you that this is going to be a healthy thing.

We will reduce the sugar quotes for the Food Industry Ministry and the
local organs of the people's government used in production.

We will replace the quota of up to 2 months of rice for the organs of the
western provinces with double the potato quota. This will save a few
thousand tons, giving out potatoes for 2 months, the harvest time when
potatoes are abundant, instead of assigning rice to the western provinces.

We will adjust the quotas for the workers lunchrooms at the sugar and
agriculture ministries except during sugarcane harvest season. This is
because food self-sufficiency has developed enough in agriculture and the
sugar industry, and this makes it possible to reduce some of the central
quotas for the lunchrooms of those ministries.

We will replace, all over the country, the afternoon meal in child care
centers with a snack -- that is, give them a more substantial snack instead
of the evening meal. This has two purposes. This idea had come up earlier.
The objective is to increase the number of child care centers, because the
demand is there. The capital itself has a strong program this year. We will
extend this program to the rest of the country in 1988. Our concern was
that this increased social programs expenditures and we estimated that
substituting one of the meals we could considerably increase the number of
centers without increasing the social programs. The child has his quota at
home. If a 5-year-old has a liter of milk at home and has his full quota,
and he is already receiving a snack, lunch, and another snack, then the
fact that he has to eat at home will do him no harm.

This will not only help to save money but it will also make it possible in
later years -- and this is the main intent -- to have a program to build
child care centers to meet the growing needs of families, of working women.
In Havana Province alone, 50 child care centers will be built in 1987. I
mean Havana City where there are some clandestine centers. Mothers, of
course, prefer the care and security that the social... [corrects himself]
the child care center provides.

We will adjust the planned excess of the students mobilized to rural
schools. This, too, in search of savings. The excess.

We will keep the number of students eating at half-board and full-board
schools at the same level as in the 1986-87 term. The number remains the
same. The quotas will not be increased.

We will reduce the monthly kerosene quota of the core consumers. In fact,
that measure has already been applied. That is the real situation.

We will adjust the gasoline quota used in administrative activities by 20
percent.

We will adjust television programming to 5 hours a day from Monday to
Friday. We will adjust television programs to 2 hours Saturdays and
Sundays.

We will earmark an additional 10 million square meters of fabric for export
that was originally intended for personal and domestic use. Yes, we will
deprive ourselves of 10 million square meters.

We will increase the electricity rate for the domestic or private sector.
The rates will go from 6.5 cents per kilowatt to 9 cents. A 2.5-cent
increase. I understand this is still 1 cent less -- if my recollection is
right -- than the rate was 30 years ago, nearly 30 years ago under
capitalism. The revolution cut the rate considerably, almost in half. What
we had before was the lineal rate, for those who exceeded 100 kilowatts. In
this case, it is raised. Even though now investments per kilowatts are
about five times higher, and fuel prices are much higher, electricity will
not cost the 10 cents that it did under capitalism. The objective of this
measure is to economize, because yearly increases in electricity
consumption are considerable.

We will regulate the assignment and use of vehicles in the civilian state
sector and eliminate the connection [vinculacion] with privately-owned
cars. There are a large number of state cars with blue plates ranging from
scooters to pickups, jeeps, cars of all kinds. These are the ones that
frequently show up at the beach, at recreation areas. The population,
rightly and fairly so, criticizes this. We will establish [corrects
himself] we are working hard so that we can define in the strictest terms
who will have what used to be called official plates. We will do this in
the shortest time possible, although it is going to take some months. We
will reduce the use of official plates to a minimum. We will define what
you can and should do in those vehicles with official plates. We will use
mostly taxicabs [vehiculos de pigueras] in organs and enterprises -- we are
still studying the enterprises more closely. These vehicles will bear signs
identifying the organization. They will belong to the organization. The
assignment of vehicles of various kinds had extended quite a bit among the
various levels of employees. That gave rise to big expenditures in fuel,
parts, tires, repairs, etc. Many of those will have their vehicles sold to
them. But they will have to repair them themselves, they will have to put
their own gas in, and they will have to provide their own tires. I believe
that this will bring considerable savings. [applause] They can transport
themselves with the private car. They pay the gasoline. They pay
everything. It will not be the responsibility of the state. Of course, this
is a measure that affects, many of these measures affect the cadres.
Several of these measures affect the cadres. But the effects have to begin
first of all among the cadres. Above all, economizing must be encouraged.

We do not have the exact figures on how many cars will be needed. We only
have estimates of the number of cars needed in central organs or organs of
the people's government to replace those currently used in the services or
that are actually required in the state central administration and the
local people's government organs. Perhaps a few thousand, because, of
course, the activities that those central organs and enterprises are
engaged in are wide-ranging, broad. Several thousand will be needed. But
they won't be the 70,000 the organs now have. Of course, the 70,000
includes motorcycles, scooters, pickups, etc. Even the buses have plates.
All these factory buses have the famous blue plate. We hope the number of
blue plates or whatever color they are -- official plates -- will be
reduced to less than 2,000, or not more than 2,000. That is the idea. That
is going to be well controlled. The assigned taxi cabs will have other
plates. And we'll have to find another plate for trucks, hospital vehicles,
pickups, certain vehicles, all, all, all of which have the same plates, so
we can know where each vehicle is and what it is doing. We must demand
responsibility for the incorrect use of those vehicles.

The link [vinculacion] was another idea that degenerated. Cars have been
sold in the past 10 years to outstanding workers, outstanding technicians.
But at first a few cars were sold to technicians who performed very
important functions and who put the vehicle at the service of the
government. That is where the link comes from. That degenerated. There was
a time when there were 20,000 linked cars. Anyone who wanted a vehicle
linked it some way or other. This way...[changes thought] the link thus
disappears as a rule, although it will be kept in part, because until we
apply these measures we won't know what the vehicle deficit will be for
indispensable functions and work. It is possible that a few thousands --
3,000, 4,000 or 5,000 -- will be linked but not at the discretion of the
organ and without any control, but through previous central authorization.
We will have to know how many a ministry can link and why. It will be
centrally controlled so that if it's 4,000, it will be 4,000, because at
one time there were 20,000 linked private cars. In recent years this has
been reduced somewhat. If we go from 20,000 to 4,000 or 5,000, and if they
are well controlled, well justified, then we will also be economizing a
good amount of fuel and other motor resources. I don't know if my
explanation is clear. I hope my fellow deputies have understood.

We will reduce diet and personnel expenses by 5 percent. I feel we could
reduce them more, but we are going to go with this one.

We will reduce foreign currency expenses in travel by 15 percent.

We will eliminate gratuities in workers' lunchrooms in all areas of
activity. If the linked wage has been established, if they are paid in
accordance with input, and if housing is sometimes provided, there should
be no justification. This measure means tens of millions of pesos a year.
Therefore the gratuities in workers' lunchrooms are eliminated in all areas
of activity.

We will increase retail prices of products from areas that are
self-sufficient. Self-sufficiency was established in sugarcane and other
agricultural farms so that they would have supplies in the lunchrooms of
those items that did not reach them from stocks -- vegetables, tubers. But
that, too, incurred excesses. It was distorted a bit. And if we don't put a
limit on it, the time will come when sugarcane will be planted for their
own consumption. As a result, there was a surplus. In addition to the
quotas they received for the lunchrooms, they began to sell to the
individual workers.

And it wasn't always small quantities of rice, beans, and so forth, at the
same price as those in the quota, which is, as you know, a nominal price
[precio incosteable]. It is a subsidized price. They were selling 15 or 20
pounds of rice at the price of regulated goods. Those who had something
left over could sell at 1 peso, 1.20 according to circumstances. It turned
into an element of income, almost, of income not based on the work. What do
we propose? Not fixing them at parallel market prices, but neither at
prices of regulated goods. If someone gets more pounds of rice or beans, he
has to pay for them at another price, not as high as in the parallel
market, but at higher prices than those that are being paid now. It is one
of the measures that must be adopted in 1987.

Now, we will increase public urban transport fares, including
transportation to and from factories. We estimate urban transport will go
up from 5 to 10 cents. This had already been discussed in the main report
to the third congress even before these needs arose. Now this measure is
being taken in light of our needs. We are trying to reduce to some extent
the use of transportation. People sometimes take it just to go two, three,
five blocks. The objective is to save fuel as much as possible, regulate,
make transportation costs more viable. Because the fares are the same or
less, well, at least the same, as 30 years ago, though fuel, equipment,
wages have been increasing through the years. What the country spends in
tires, batteries, parts is considerable. This puts it on firmer economic
bases. It's not that we are going to charge the same as in other countries,
which as a rule can be $0.30, $0.35. It's a dollar in New York. With what
you spend on a single trip in New York here you could make 20 trips. Now
you can make 10. Of course, we are aware that this measure affects personal
and family income. The measures on transport and electricity are the ones
that really affect the most.

This has to go along with a study on what to do in those articulated buses
where there are people who don't pay. What measures can be taken to make it
more accessible when you get on a bus. Whether to put coin boxes at the
various doors. The comrades in the party and the transport institute are
working on that, to see what rational measures can facilitate the use of
this transportation and facilitate collection. It seems that we will have
to put conductors in those articulated buses. We'll see what measures we'll
take, because some people are going without paying those insignificant 5
cents.

We will ensure the self-financing of popular fiestas.

We will revise medical diets, including permanent ones, because diets have
also been abused. They go for one stay and they stay forever. Each time
there is a diet you try to resolve, to satisfy it. But there are those who
give diets out of friendship. I don't know if they are called the same as
the certificates of complacency, diets of complacency. They are going to be
studied, regulated, because there are about 1.2 million. And sometimes the
diet consists of meat, of this and that, of milk. We must have better
control of these diets.

We will reduce the number of work events and meetings no less than an
overall 50 percent. [applause]

We will modify the schedules of sporting and other recreational events.

I will increase the prices for some parallel market prices -- not all, but
some. This is for the same reasons. Because of shortages that could arise,
the parallel market must not be given up. It is an important source of
income. It helps to resolve some deficits at the discretion of the
population.

These are the measures agreed upon. They will help us to find an internal
financial balance. They are included in the budget.

And, I repeat, we cannot give assurances that the need might not arise to
take additional measures during the year. We will do as much as possible to
avoid them, but we cannot give assurances at this time. In 1987, 1988 some
other measures will have to be implemented. They might less directly affect
the public, but we will have to take them in 1987, 1988 to guarantee
development plans and for a better redistribution of income. I say better
redistribution because in this case, along with these measures, we are
thinking of retirees, for instance, who have less income. The retirees do
not enjoy the advantage of adding to their yearly wages with the linking,
the productivity. There are some hundreds of thousands whose pensions are
less than 100 pesos. They are going to be giving up to 5 pesos extra to
those retirees who are receiving less than 100. Up to 5 pesos. The maximum
is 5 to those who are getting less, and those who are nearing 100 will get
a little less. [rustling of papers] We feel that this increase partly
compensates. These pension increases could amount to 40 million pesos. So,
part of the income is redistributed. It will be some 40 million pesos each
year. I was being reminded that there will also be an increase in
inter-province transportation. I had not mentioned it when I spoke of the
fare increases. The urban [changes thought] I did not mention it. Increase
in the public inter-province transportation fare.

These are all the measures adopted taking into account the situation that
more or less directly, to a greater or lesser extent, affects public
consumption or fundamentally affects public expenses.

Of course, this situation makes the rectification of errors and negative
trends not only a moral obligation and a revolutionary duty, but also
essential. We have talked about these errors and negative trends during the
year, since the Third Congress; they are beginning to be rectified.

I must say, fellow deputies, that our country has been a privileged
country. It has had considerable resources, not only to carry on a strong
economic development program which can be seen in the reports from all the
provinces. This can be seen very clearly when Havana province, Cienfuegos,
Camaguey, Granma speak. They have the inventory of everything that the
revolution has achieved in the economic field and the enormous inventory of
everything that the revolution has achieved in the social field in the
course of these 27 years, despite the imperialist blockade, and despite the
inevitable expenses in the services to defend the country and the
revolution.

We have had colossal achievements in health, education, sports, in the
whole social field, culture. There are very important economic achievements
as well. The truth is that there exists our patriotic, revolutionary
effort; we are always ready to fight, to make any sacrifice, even sacrifice
our lives, which no revolutionary thinks twice about. However this has not
been the same in productive activities. [applause]

We have spent practically all that we have wanted to. Enormous sums. And
the lady [not further identified] spoke precisely of how everybody wants to
resolve in a year all the problems that have accumulated for centuries.
Many times they try to go over the plan to solve these problems. They do
not have the necessary patience to wait. In all fields: education, health,
culture. I gave as an example the day that the drive of our dear comrade
Armando Hart was launched, the idea of a cultural module for each
municipality. A movie house, library, everything else. And things were done
by coming up with some idea for a drive. They said "cultural module," and
there went everybody building 10 modules for each municipality, without
anyone making any estimates anywhere of how many resources the cultural
module required. Fine. Sports fields, everything.

Our country has had the privilege of having all the fuel that it has
needed. All the tractors it wanted. Many things, all that it has needed and
even more. This has brought waste as a consequence. People were spending
without consideration of any sort.

We have wasted fuel, material resources, raw materials, everything. Those
are the facts. Until we start economizing. I gave the example of fuel.
Without a policy of economizing, those 3 millions would be wasted. For
sure. Things are being done in an attempt to overcome deficiencies. But we
still have a great deal to do in the area of material production. Far from
waging the battle in that direction, vices and negative trends were
emerging of all kinds. There were distortions in wages, obsolete standards
which were never brought up to date, the standards that remained the same
despite the introduction of anything that would raise productivity. The
diversion of resources of all kinds. And all the rest of the problems,
including the swap among enterprises, between cooperatives and state
enterprises, etc. All this that we have been discussing in the course of
the year.

Some anonymous heroes among the people fought against those outrages. In he
best of cases, they were ignored. Sometimes they were even silenced.
There's this girl from Santiago who appeared in GRANMA yesterday and today.
These are two articles that are worth reading, so people can become aware
of some behavior, some attitudes that we must completely eradicate. This
comrade Spencer [rustling of paper, Raul Castro saying "Spencer, Sylvia
Spencer," in background], Comrade Sylvia (Marjorie), who worked in the
Santiago de Cuba cement factory. She talked about these things. For
instance, on 18 November -- I don't know the year -- in a lengthy report to
the deputy director of human resources... [Raul Castro whispers "1984,
1983"] 1983? I don"t know if this refers to 1983. [Raul Castro says:
"She's been fighting 3 years against these devils you were denouncing. And
they almost turned here into [word indistinct] puree"] She was reporting
wage violations and errors, detected in the payrolls, to the administrative
staff. She was alerting them to the fact that with personnel already hired,
contracts were made although the position did not exist on the staff. In
1984, in a report dated 25 April, she denounced fellow workers who were
reported twice, with workdays of 24, 26, and 28 hours. Many of these cases
came up often in the party's talks with the enterprises in the provinces.
The wages of some were incredible for a single month: 1,246 pesos, 1,013
pesos, and 8 others; 4 with more than 900 pesos, and the rest with more
than 800. There are workers who have a job by agreement [trabajo por
acuerdo] and also have entitlements and double pay [horas habilitades y
doblajes].

In these things showed up very clearly. There were other similar phenomena
in the analysis of the negative trends and errors. Resources have been
wasted in all that. Money wasted in incalculable amounts. That is not all.
The worst is that this has very negative moral implications, really
demoralizing and corrupting effects. The worst thing is that all these
things tend to corrupt people. It is very easy to give, to distribute;
taking is what's hard.

And that is why I said that the struggle against this trend is no longer
just a moral and revolutionary obligation in order for the revolution to
move faster, for development to be faster, firmer, more solid. It is a
vital economic necessity. This rectification process is taking place
precisely when economic difficulties are greater. Some will ask: What does
this rectification process produce? If you think about it, you will realize
that it can have tremendous effects on the efficiency of production, of
services. Tremendous effects on the economy. I am going to cite two
examples, to which you have been witness. They came up yesterday afternoon,
when Comrade Homero was speaking, a deputy from Cienfuegos. He was telling
us what had been accomplished there in the CEN [electronuclear plant]. It
was on 19 April, if my memory serves me, when I raised the issue of the
CEN, the underutilization of the workday, the demand of 17,000 workers to
build that project.

What was the result of that? There alone, there alone, to become aware of
the problem of manpower underutilization. They may not have been aware of
that problem when they were asking 5,000 workers more for the last stage,
when the work would be stepped up. Five thousand additional workers are
5,000 additional workers to be transported from Santiago de Cuba by bus,
which uses up 8 [corrects himself] 1 gallon for every 8 km. For 800 km, 100
gallons. They have to get gasoline about three times on the road. Imagine
every 30 workers. More than 150 trips by buses Giron 4 and Giron 5 to go to
Cente, which is the only place there is an excess work force, to pick up
the 5,000 freeded in Cienfuegos. Housing for 5,000. Uniforms, clothing,
shoes for an additional 5,000. Food for an additional 5,000, and the people
working there in the CEN have a special diet! He was telling us yesterday
that by simply raising the utilization of the workday, they had managed to
increase productivity from 67 percent, which was the figure given to me, to
78. And they are managing to bring it up to 85. From that moment, when we
raised the issue, up to now, they have raised the utilization of the
workday the equivalent of 1,000 construction workers. With the utilization
of the workday alone. Now you figure what it means that they can build that
project with 12,000 workers, instead of 17,000. Doesn't that have
repercussions on the economy? I am sure that the 12,000 workers, by
utilizing the workday well, at 85 percent, will build that project in the
required time and with the required high quality.

Another example came up in what Comrade Lezcano said about using good
cadres in that enterprise and following a rational criterion in regard to
indirect workers, staffs, services. The approved staff for that very
important ironworks went from 1,900 workers to 1,020 workers. Witness the
policy to rectify negative trends and errors in a single factory: a
reduction of almost half the workers. Nine hundred less workers to
transport, 900 workers less to think about getting housing, quotas, food,
all that.

See what rectification can do in the material sphere. Two examples only.
Extend that to the breadth and length of the country in every new factory.
And I say every new factory or service because the present situation can
hardly be touched. We would create a tremendous social upheaval. This has
to be done slowly, each time there is a new industry, a new factory. Above
all, we have to be conscious of these problems.

This does clearly demonstrate what I have repeated so often this year. The
role of the party is irreplaceable. Socialism cannot be built without the
active, intelligent, wise role of the party. Development is not possible.
Nothing is possible. This also demonstrates that the party really works
with man. The party organizes, the party educates, the party creates
awareness. I have seen these manifestations of awareness making headway. I
have already seen centers that want to do the same thing that the genetic
engineering center and other centers are doing. This trend is being
fostered.

As I said at the Central Committee meeting, we can't now suddenly
rationalize everything. No, because we don't have a way to employ them. I
believe we have to do it gradually. Each new service, each new project. As
we are planning to do in Havana with the expansion of hospital services. We
know that there are thousands extra. But we are going to transfer them. We
are not going to take them out now. We are not going to create that social,
political problem. We are going to be transferring them, redistributing
them, so that a hospital will have more beds with the same amount of
workers, or with a minimum, if the increase in beds is considerable. That
is what we have to start doing. It is more urgent in the western regions
than in the eastern, because, as we were saying yesterday, there is a
certain surplus in the labor force in the eastern regions, which requires a
program in that direction, in the direction of industrial investments.

We cannot take full advantage of these ideas now. We have to do that in the
course of time. We have to develop to solve those problems, give the most
rational employment to our citizens, both in the field of services and in
the field of economic development and material production.

An example of a citizen providing a very valuable service is the family
doctor. We have not turned that young person into a bureaucrat, an
unproductive worker. Three of them are not doing the work that one can do.
We have him with the family, giving security to 600 people, prolonging the
life of 600 people, ensuring the well-being of 600 people as much as
humanly possible. That is a service that is greatly appreciated. Those
doctors that are on the mountain and all over reducing infant mortality
and, especially, prolonging life, especially prolonging life.

The programs to increase longevity will not do it so much by reducing
infant mortality because the margin left in that area is very narrow.
Anything that is done to increase longevity will have to be done on the
basis of prolonging the lives of adults and the elderly. Allowing them to
live until 80 instead of 70, 85 instead of 75, or 90 or more. The program
to reduce infant mortality has helped the children. These programs carried
out through the family doctor help the whole adult population.

Now more useful to have a citizen with a job of this kind. What does not
translate into material production increased will translate into expansion
and improvement in very important social services. And we have to do it
gradually, slowly. We cannot go galloping in this. We have to think
everything over carefully. These two examples in the sphere of material
production indicate how much this rectification can achieve materially and
socially.

Let's go back a few days, when we had the deferred congress session.
Comrade Caballero, member of the Central Committee and new director of the
Miguel Enriquez Hospital, was telling us about the fabulous things he had
achieved there with the rectification process. Consuming in 3 months the
special gasoline that used to be consumed in 1 month. Resolving the problem
of 4 or 6 mosquito nets that they needed in the hospital and availing
themselves of the 2,000 stored in the warehouses. Resolving the problem of
funds, which were exhausted in October. And I am not talking of a material
production center. I am speaking about a hospital. How much doesn't remain
to be done in this field? In schools, hospitals, everywhere. He did not
only save material goods, he improved services, reduced absenteeism among
nurses from 7 to 3. Of 52 doctors who did not do watch duty, he reduced
them to 2. And so on.

Why couldn't we improve services? Of course, preaching by example, because
the first one who stood watch was he. He, who was the director, was doing
surgery, seeing patients.

I am simply giving you three examples. These three examples can be
multiplied thousands of times throughout the country. Comrades, I sincerely
believe that these lean cows in the area of the convertible currency, are
lean in a very important area. These lean years could prove to be very
useful if these years teach us to be much more sufficient, much more
economical, much more responsible. l don't know if it's part of our
idiosyncracy, what's still left of the individualistic and anarchic spirit,
the inheritance of so many centuries of colonialism and neocolonialism, of
so many centuries of self-centerdness and capitalism. I don't know if it's
because of that, but there is no doubt that any measure here tends to
quickly degenerate.

Use interruptos to resolve the problem of the tobacco growers because of
the blue mold, they said. And "interruptism" spreads with its sequel of
plunder, unwarranted waste, of individuals who broke equipment so they
could become interruptos and work on their own -- all those things came
with it.

Let's link the technicians. Very important. They suddenly put their
vehicles at the service of the state. Everyone was linked. And many more
measures could be mentioned, cases in which useful, positive ideas,
immediately get out of control, degenerate. Let's link work. That
degenerated into an absurd situation. They were linking everybody, even
radio announcers, producers, who knows that, in areas where linking was not
appropriate.

Let's use material incentives, and all of a sudden the material incentives
went out of orbit and people were corrupted. And so we have that tendency
that requires that we be very careful in everything we do because of the
way it immediately gets out of control, people abuse it, and it
degenerates.

I am deeply convinced that if we know how to work, if we know how to make
the best of this situation, and we become as efficient as is needed to
utilize 85 percent of the workday instead of just 60-odd, or if we use only
half of all those overinflated staffs we are now using, if we really learn
to administer efficiently -- if we had administered the same resources we
have had through the years with true efficiency, how many more things would
we not have in all fields? Projects would have been 50 percent more, 100
percent more. Yes, that's it. No one knows. What could be done by optimal
use of resources is incalculable. We are rather grown up now. We are no
longer an illiterate people who cannot understand what the problems are.
The people have a ninth grade education. Almost all the young have 12 years
of schooling. Professionals, whose who have finished college and those who
are still in college, now number hundreds of thousands. There should be no
justification for going on merrily and irresponsibly.

It would be hard to have more resources than the ones we have had, more
outside cooperation. There is no doubt that whatever additional resources
we have from now on we will have to get out of our own work, our
intelligence, our effort. Nothing will come easy. What we have to do is
multiply the fruit of the enormous resources that we have available. If we
have scores of tractors, it's not to make them all run. That has been
limited for some time, but more could be done. Trucks running around, going
where they don't have to go. Tractors used for anything, for private
business. Those are all the things we must eradicate, because they are very
expensive, very costly for the economy, for the country, for the
revolution, all these excesses.

I am not denying that we have made progress in many fields, but there is
still a great deal to do. And more importantly, we should take care that
what we make progress in one one hand we don't waste on the other. It is
also very important to strictly implement the agreed on policy on priority
investments. Each party cadre, each people's government cadre wherever he
is must have the list of the priority projects. Whatever they are, a
tobacco shed, even if only a tobacco shed, or the extension to a poultry
slaughterhouse, as we were saying at the Central Committee, because it
saves meat, because it saves feed imports. Big or not, every little project
listed as priority must be carried out. Keep the list next to your bed,
each one of you, so that these priority projects will be carried out. Those
that save imports in convertible currency, those that increase exports in
convertible currency.

This does not mean that we should forget the CEN. The CEN is not a number
one project. It is a number two project. But when the CEN gets its four
reactors we will be saving $500 million in fuel a year. It will allow us to
keep increasing our acquisition of electrical appliances. We'll be able to
cook with electricity, something we are not doing now because we would
considerably increase costs. That is a project that cannot be neglected a
single minute. Well, no project should be neglected a single minute, but
this one, which has priority, has to be followed closely. And then the
others. Because the important thing about this plan, as the lady was
saying, is that it be fulfilled. We are going to review how investments are
going every 3 months. If on a particular project we can't invest what the
plan calls for, then we will centrally transfer from that project to
another project that is in a better situation to do more.

We were talking about the need to build more hydraulic works. Well, the
planning board must study how much (?rubber), material, resources, fuel are
needed for an adequate dams building plan.

I don't know how many millions of cubic meters we will be moving now in
that field, but if it is 10, let's make a plan for 20, 30. Let's make
calculations as to how much material we'll use. We can't simply measure it
in pesos, because a budgeted peso spent on a hospital, which requires so
many expenses in convertible currency, so many direct employees [directos],
so much equipment, is not the same as a peso invested on a dam. We have to
see how much that means in fuel. Well, indirect foreign exchange in cement
and other materials. Because you are working with soil, and a peso in a
hospital does not generate as much expense in convertible currency as a
peso in a dam-building plan.

We must calculate how much a peso in building warehouses is going to cost.
What it means, what it cost in foreign exchange. Because it is not going to
cost the same as a hospital. The need for a program to build so many square
meters of warehouses each year can be clearly seen, not to meet needs in 6
months or a year, but to meet needs at least in 5 or 10. A rational
program, a well thought out program. Which and where to build each year.

We have to distribute and redistribute our resources to optimize our
economic efforts and our plans and invest there where the investment will
more quickly solve big economic problems or big social problems. I am sure
that this situation is going to make us much more efficient.

We have a party of half a million members, and in addition, we have the
young, the mass organizations. We have enormous resources. These are not
the first years of the revolution. Our cadres have acquired enormous
experience, the capacity to think, to analyze. We are not facing a
difficult task, which is drafting a plan like this. It will bring
difficulties, it will bring delays, because it is not easy to carry out
trade in these circumstances, in which for the first time we find ourselves
in a situation in which we have been unable to meet our financial
obligations. This brings difficulties even to carry out trade with the
available resources. We will have to work under more difficult conditions
than when we had reserves of certain raw materials and certain resources.

We are not going to execute the plan in ideal conditions, but in
particularly difficult conditions, in which we will often be lacking one or
two indispensable raw materials, or they will be delayed even if we have
the other 35 or 36 or 38.

I believe, ladies and gentlemen, that this is the essence of our work, the
essence of our problems. If we work well with all our human and material
resources, if we take advantage of our relations with the socialist
countries and optimize the use of our resources, we will emerge from these
difficulties. We cannot think we'll do it in 1988. Things have to be
planned on the long term. And the virtues we may acquire in this struggle,
this effort, we should enrich them, keep them first of all, enrich them,
and develop them further. [applause]

I do believe in several things. One of them is the potential of man, of
revolutionary man. Life has taught me that there is no obstacle that cannot
be surmounted. I very firmly believe in the potential of socialism.

Socialism may not have yet overcome its inexperience, may not have yet
overcome its mistakes, may not have made its methods perfect, but I believe
in a method of building socialism based on the consciousness of man, on
political work, on revolutionary work, that realistically knows how to use
material incentives without corrupting people, without it being the
leitmotiv -- let us say the motive -- of their efforts. The advantages
socialism has in being able to plan, foresee the future, and work on the
long term are fabulous.

The possibilities of building socialism among a people as enthusiastic as
ours, as revolutionary as ours, as patriotic as ours -- these are
unquestionable virtues above the negative tendencies that I was referring
to before -- are fabulous.

When Flavio was speaking about our democracy, comparing it with imperialist
democracy, I was thinking that not only does more than 95 percent of the
population take part in elections, but look who they elect. It would be
difficult in our democratic process to elect a scoundrel, a thief, a
multimillionaire. To run for public office in that capitalist society costs
billions in publicity -- publicity is one way to pass lies as truth. What a
difference form that capitalist system with lack of internal unity, its
divisions. And I think of the advantages of a totally united people as
here. A single army, capable of hitting with a single fist. The advantages
our system has to face any problem. The subjective and objective advantages
to set itself any goal. They are incredible. The limitations are in
ourselves, in our incapacity to know how to utilize all this fabulous
potential. We have come far, we have done many things in these 27, almost
28 years, but as I have said other times, we could have done much more.
Many things. Better things. We have made much progress, but we could have
made much more in these 28 years.

Today we have the responsibility not only of solving our problems but also
to set a good, positive example of how problems can and should be solved in
socialism. This means a historic challenge for us of a national nature and
also a historic challenge of an international nature.

The imperialists may try to take advantage of our criticism and
self-criticism, of our struggle to overcome these mistakes, but this should
not worry us at all. They should be worried, really, about what we are
doing, this rectification, because they do know that if we do otherwise we
would go wrong. We would create all sorts of problems for ourselves in the
future. They know that this is the right road. That must worry the
imperialists a good deal. I am convinced that we are on the right course,
that we are on the right road. I am absolutely convinced. This process is
really promising. With all the factors within our reach, if our people in
the past were capable of overcoming very big obstacles and win very
difficult battles, now that we just had the 30th anniversary of that
meeting of Raul and me in Cinco Palmas [applause], I can repeat today: We
are truly going to build socialism now. [applause; shouts of "Viva Fidel,"
"Viva Raul"]
-END-


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